Can you really save £300 a year with a wood burning stove?

We investigate the realistic savings of installing a wood-fuelled heating
system

A press release popped into my inbox last week, claiming that the average household could save more than £300 a year by installing a wood burning stove.

The figure, worked out by wood burning stove manufacturer Chesney's, was based on the calculation that burning wood pellets cost 4p per kilowatt hour, while using gas will cost 6p per kilowatt hour when the recently announced price increases take effect from mid-November.

The comparison covers pellets rather than logs. The cost for logs can vary hugely, from nothing - if you have your own supply - to more than £100 per cubic metre of seasoned hardwood logs. It costs less if you have the space to store logs that need drying for a year or two.

Using that £300 claim on the figures for wood pellets, it is possible to draw on industry data.

The average household gas consumption, the release stated, was 16,500kWh a year. That works out at an annual cost of £660 to burn wood and £990 to use gas.

uSwitch.com, a comparison site, puts the average cost of gas at 5p per kilowatt hour for households when the price increases have been taken into consideration, which works out at an annual cost of £765.

Ofgem do not provide figures for cost per kWh, but their latest estimate for the average annual customer gas bill is £755. That means a saving of just £95 for the average household, not £330.

That ties in more neatly with figures from theEnergy Saving Trustthat state switching to wood-fuelled heating saves around £100 annually for gas-heated homes.

"Gas heating and wood heating costs are similar so the savings on your fuel bill are smaller," said Brian Horne of the Energy Saving Trust.

However, it is worth pointing out that some 3.6m households in the UK that are not connected to the gas grid could save far more by switching to wood-fuelled heating systems.

The annual energy bill savings for electric-heated homes, for example, could be around £630.

Source: Energy Saving Trust

Homes off the gas grid can also apply for a £2,000 grant to intall biomass boilers, which burn wood, under the Renewable Heat Premium Payment scheme.

The installation cost of wood-fuelled heating starts at around £2,000 for a log stove, while a pellet stove typically costs around £4,300.

When it launches next year, the Renewable Heat Incentive will pay households to produce heat from a wood heating system, which could makes biomass boilers and stoves more attractive.

However, the main thing that rules out many households for wood-fuelled heating is the space to store the material.

"Wood is only attractive to people who have the space to store it, and many of those places are rural and off the gas grid anyway," said Mr Horne. "Urban houses and flats are usually ruled out for this reason."